AC prices to go up by 5% due to customs duty hike, rise in logistics cost

New Delhi: Season for air-condition sales is going to start soon, and the sector is bracing for a hike of up to 5 per cent, amid combined impact of customs duty hike on compressors and increased logistics costs due to Coronavirus outbreak in China, which is the main supplier.

Amid Coronavirus scare, several manufacturers expect 2020 to be a challenging year for the industry as they are going to airlift component such as controllers, compressors and other materials from China, Thailand and Malaysia and the increased logistic cost would put pressure on input costs.

According to some makers, the crisis unfortunately has come at a critical time, when April-June season is knocking, during which the industry accounts around 40 to 45 per cent sale of residential airconditioners. There is a shortage due to Coronavirus and in order to keep the production up, we are airlifting the critical components from China. There is also an increase in customs duty on compressors and others, Blue Star Managing Director B Thiagarajan said.